Diplomacy, high-level lobbying boost U.S. pistachio sales to Israel

WASHINGTON — An adroit lobbying campaign has cracked open the bountiful Israeli market for San Joaquin Valley pistachios.

It took many years, false starts and dead ends, all in the shadow of the fraught relationship between the United States and Iran. Diplomats and politicians got involved, at the highest levels. The solution itself is a bit of bank shot. And yet, it's already paying off as Valley pistachio shipments climb.

"This has been for us an issue that's been very frustrating, to say the least," Richard Matoian, executive director of the Fresno-based Western Pistachio Association, said Friday.

The historic problem, Valley growers say, has been that low-cost Iranian pistachios were imported into Israel via Turkey. That stings, because Israel potentially is a lucrative market. The county leads the world in per-capita pistachio consumption.

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In theory, Israel maintains a trade embargo on Iran. In practice, Valley growers say, they have repeatedly found evidence of Iranian pistachios finding their way into Israel. Since 1997, when then-Secretary of State Madeline Albright weighed in, U.S. officials have periodically pressed Israel to stop the Iranian shipments.

Earlier this year, the maneuvering culminated in Israel raising its tariff on non-U.S. pistachios to 23 percent. That tariff, plus an added weight-based duty, effectively rendered the tariff-free U.S. pistachios a better buy than the foreign competition.

Matoian estimated that U.S. pistachio exports to Israel could now increase to as much as $20 million a year, compared to the $300,000 worth exported last year.

"We appreciate the warm relations we have with the United States," Yakov Poles, agricultural attache for the Israeli Embassy, said Friday. "Since this issue was raised by pistachio growers in California, we took it very seriously."

Some well-placed friends helped, too.

In April, for instance, a State Department telegram directed U.S. Ambassador Richard H. Jones to convey to Israeli officials that "reports of Iranian pistachios entering Israel are attracting increased attention in the U.S. Congress and media, and are a source of embarrassment to our governments."

The congressional and media attention, in turn, arose partly through the work of the Western Pistachio Association's D.C. lobbying firm, Schramm, Williams & Associates. The pistachio trade organization paid the firm about $50,000 last year, lobbying records show.

The connections thickened in October, when Rep. Jim Costa, D-Fresno, hosted a fundraising event in Clovis. His guest was Rep. Howard Berman, D-Los Angeles. Berman chairs the House Foreign Affairs Committee, on which Costa sits, and he is sympathetic to Israeli concerns.

This was opportunity knocking, for the pistachio growers. The Western Pistachio Association Political Action Committee, which shares D.C. office space with the Schramm, Williams & Associates lobbying firm, made a $2,300 contribution to Costa that day. Matoian and two members of his board of directors, Michael Woolf and Jim Zion, attended the Costa fundraiser, with an eye toward meeting Berman.

"We were able to pull him aside for about 10 minutes," Matoian said.

A second meeting followed, by teleconference, with Berman pledging to bring the pistachio issue up with top Israeli officials. The involvement of the foreign affairs chairman was key, Matoian said.

Matoian acknowledged that Israel's raising of all pistachio tariffs to solve a problem attributed strictly to Iranian imports was an "indirect" solution. Diplomatically, though, it may have proven easier than explicitly confronting anything involving Iran.

"The congressman is happy," said Costa's press secretary, Bret Rumbeck. "This is good for our growers, and it's good for the Valley."